MKT 340 Ch05 ppt
- 1. Slide 5-1 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
- 2. Slide 5-2 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. LO 5-2 LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 5, YOU SHOULD BE ABLE TO: LO 5-1 Distinguish among industrial, reseller, and government organizational markets. Describe the key characteristics of organizational buying that make it different from consumer buying.
- 3. Slide 5-3 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. LO 5-4 LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 5, YOU SHOULD BE ABLE TO: LO 5-3 Explain how buying centers and buying situations influence organizational purchasing. Recognize the importance and nature of online buying in industrial, reseller, and government organizational markets.
- 4. Slide 5-4 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. BUYING IS MARKETING, TOO! PURCHASING PUBLICATION PAPER FOR JCPENNEY JC Penney Web site
- 5. Slide 5-5 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. THE NATURE AND SIZE OF ORGANIZATIONAL MARKETS LO 5-1 Business Marketing Organizational Buyers • Industrial Markets (Industrial Firms) • Reseller Markets (Resellers) • Government Markets (Government Agencies) Retailers Wholesalers NASA
- 6. Slide 5-6 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-A Type and number of organization establishments in the U.S.: 2007
- 7. Slide 5-7 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. MEASURING DOMESTIC AND GLOBAL INDUSTRIAL, RESELLER, AND GOVERNMENT MARKETS LO 5-1 North American Industry Classification System (NAICS) North American Free Trade Agreement (NAFTA)
- 8. Slide 5-8 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-1 NAICS breakdown for the information industries sector:NAICS code 51
- 9. Slide 5-9 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-2 Key characteristics and dimensions of organizational buying behavior
- 10. Slide 5-10 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. CHARACTERISTICS OF ORGANIZATIONAL BUYING LO 5-2 Derived Demand Size of Order or Purchase Number of Potential Buyers Organizational Buying Objectives • Profits • Efficiency • Women/Minority Suppliers/Vendors • Environment/ Sustainability
- 11. Slide 5-11 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. CHARACTERISTICS OF ORGANIZATIONAL BUYING ORGANIZATIONAL BUYING CRITERIA LO 5-2 Supplier Development Organizational Buying Criteria
- 12. Slide 5-12 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-B Key organizational buying criteria
- 13. Slide 5-13 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. CHARACTERISTICS OF ORGANIZATIONAL BUYING BUYER-SELLER RELATIONSHIPS & SUPPLY PARTNERSHIPS LO 5-2 Supply Partnership Sustainable Procurement – to benefit the environment Reciprocity
- 14. Slide 5-14 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-3 Product and supplier selection criteria for buying machine vision equipment emphasize factors other than price Machine vision inspection camera used in auto industry to perform a gear inspection Percentage of machine vision buyers citing individual selection criteria as important when making supplier decision
- 15. Slide 5-15 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. MARKETING MATTERS Milsco Mfg.—Delivering a Great Ride for Customers’ Seats LO 5-2 Harley-Davidson Video
- 16. Slide 5-16 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. MAKING RESPONSIBLE DECISIONS Sustainable Procurement for Sustainable Growth LO 5-2 Starbucks Sustainability
- 17. Slide 5-17 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-4 Comparing the stages in a consumer and organizational purchase decision process
- 18. Slide 5-18 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. ORGANIZATIONAL BUYING PROCESS AND THEY BUYING CENTERLO 5-3 Buying Center Buying Committee People in the Buying Center Roles in the Buying Center • Users • Influencers • Buyers • Deciders • Gatekeepers
- 19. Slide 5-19 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. CHARACTERISTICS OF ORGANIZATIONAL BUYING THE BUYING CENTER LO 5-3 Buy Classes • Straight Rebuy • Modified Rebuy • New Rebuy
- 20. Slide 5-20 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-5 The buying situation affects buying center behavior in different ways
- 21. Slide 5-21 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. ONLINE BUYING IN ORGANIZATIONAL MARKETS LO 5-4 Prominence of Online Buying in Organizational Markets E-marketplaces Online Auctions in Organizational Markets • Traditional Auction • Reverse Auction
- 22. Slide 5-22 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. MARKETING MATTERS eBay Means Business for Entrepreneurs LO 5-4 eBay Web site
- 23. Slide 5-23 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. FIGURE 5-6 How buyer and seller participants and price behavior differ by type of online auction
- 24. Slide 5-24 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. TREK: BUILDING BETTER BIKES THROUGH ORGANIZATIONAL BUYING VIDEO CASE 5 Trek Video Case
- 25. Slide 5-25 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. VIDEO CASE 5 Trek 1. What is the role of the buying center at Trek? Who is likely to comprise the buying center in the decision to select a new supplier at Trek?
- 26. Slide 5-26 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. VIDEO CASE 5 Trek 2. What selection criteria does Trek utilize when it selects a new supplier or evaluates an existing supplier?
- 27. Slide 5-27 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. VIDEO CASE 5 Trek 3. How has Trek’s interest in the environmental impact of its business influenced its organizational buying process?
- 28. Slide 5-28 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. VIDEO CASE 5 Trek 4. Provide an example of each of the three buying situations—straight rebuy, modified rebuy, and new buy—at Trek.
- 29. Slide 5-29 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. DAKTRONICS: REACHING AN ORGANIZATION’S BUYING CENTER IN-CLASS ACTIVITY 5-1
- 30. Slide 5-30 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. ICA 5-1 Buying Process Example: Daktronics Products Reaching an Organization’s Buying Center
- 31. Slide 5-31 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
- 32. Slide 5-32 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
- 33. Slide 5-33 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Business Marketing Business marketing involves the marketing of goods and services to companies, governments, or not-for-profit organizations for use in the creation of goods and services that they can produce and market to others.
- 34. Slide 5-34 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Organizational Buyers Organizational buyers are those manufacturers, wholesalers, retailers, and government agencies that buy goods and services for their own use or for resale.
- 35. Slide 5-35 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. North American Industry Classification System (NAICS) The North American Industry Classification System (NAICS) provides common industry definitions for Canada, Mexico, and the United States, which makes it easier to measure economic activity in the three member countries of the North American Free Trade Agreement (NAFTA).
- 36. Slide 5-36 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Derived Demand Derived demand is the demand for industrial products and services that is driven by, or derived from, the demand for consumer products and services.
- 37. Slide 5-37 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Organizational Buying Criteria Organizational buying criteria are the objective attributes of the supplier’s products and services and the capabilities of the supplier itself.
- 38. Slide 5-38 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Supplier Development Supplier development is the deliberate effort by organizational buyers to build relationships that shape suppliers’ products, services, and capabilities to fit a buyer’s needs and those of its customers.
- 39. Slide 5-39 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Reciprocity Reciprocity is an industrial buying practice in which two organizations agree to purchase each other’s products and services.
- 40. Slide 5-40 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Supply Partnership A supply partnership is a relationship that exists when a buyer and its supplier adopt mutually beneficial objectives, policies, and procedures for the purpose of lowering the cost or increasing the value of products and services delivered to the ultimate consumer.
- 41. Slide 5-41 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Buying Center A buying center consists of the group of people in an organization who participate in the buying process and share common goals, risks, and knowledge important to a purchase decision.
- 42. Slide 5-42 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Buy Classes Buy classes consist of three types of organizational buying situations: straight rebuy, new buy, and modified rebuy.
- 43. Slide 5-43 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. E-marketplaces E-marketplaces are online trading communities that bring together buyers and supplier organizations to make possible the real time exchange of information, money, products, and services. Also called B2B exchanges or e-hubs.
- 44. Slide 5-44 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Traditional Auction A traditional auction, in an e-marketplace, is an online auction in which a seller puts an item up for sale and would-be buyers are invited to bid in competition with each other.
- 45. Slide 5-45 © 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. Reverse Auction A reverse auction, in an e-marketplace, is an online auction in which a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other.